Buyer-supplier embeddedness
and patterns of innovation
The purpose of this paper is to describe different ways in which a buyer and supplier can
be embedded in a dyadic relationship and how these differences influence patterns of inter-firm
innovation activities and outcomes. Specifically, to address the relative paucity of theoretical work on
how dyadic configurations influence parties’ joint innovation behavior, this study examines how
different buyer-supplier embeddedness (BSE) configurations change the four choices that pertain to
the levels of involvement buyers and suppliers exhibit in inter-firm innovation activities. These choices
concern the processes buyers use to engage suppliers; the scope of efforts in each party; the locus of
effects determining the beneficiaries; and the extent to which parties disclose private innovations
within the relationship.
The authors demonstrate the configurational approach to the innovation patterns in
inter-organizational setting. That is, the authors conclude that different configurations of BSE are
likely to produce distinctive patterns of choices for inter-firm innovation activities.